Govt contemplating changing procedures for TUFS

PTIAug 3, 2004, 05.02pm IST

NEW DELHI: The government today said Textile Ministry will be made an important part of the mechanism for disbursal of loans under the Technology Upgradation Fund Scheme for the textile sector."Till date, only Rs 7,000 crore from the Rs 25,000 crore earmarked for TUFS has been disbursed. To increase the flow of funds to textile units under the scheme, we are thinking of a mechanism where a Textile Ministry representative can sit on the loan-sanctioning committee," Minister for Textiles Shankersinh Vaghela told newsmen here.The Ministry representative would act as a facilitator for the interested units by recommending cases to financial institutions and making procedures simpler, he said, adding alternatively, the Ministry could collect all the applications and forward them.Under the TUFS, the government gives an interest subsidy of five per cent for units in every stage of the textile chain.Last month, Vaghela had met the chiefs of financial institutions who are involved in the TUFS. According to a Ministry official, after the recent changes in the taxation structure for the sector, FIs are expected to come forward in a big way to fund units under the TUFS.Estimates show that in this fiscal, Rs 3000-4000 crore of additional loans can be disbursed under TUFS.